Storm Financial Group

[Julia]

There is every chance ROE that you're right and 'this may never happen'. However, what is very obvious is that the present system is grossly ineffective or the storm debacle would never have occurred.

Perhaps remember that the 'system' did not fail everyone. It is quite wrong to extrapolate from the shonky behaviour of the Storm principals that the whole financial system is dysfunctional.

 

[medicowallet]

Agree 100% Frank. I know of a guy who was caught defrauding investors in a failed movie, who became a financial adviser and was then caught misleading clients who then started up his own advice business and has now been banned for being an adviser for 5 years. He will find some other way to make a quick buck at the expense of others. No jail time, minimal financial penalties...absolutely no deterrent from offending again. There would be hundreds of people who have done similar.

ASIC have no teeth at all.

As long as he paid his taxes to the ATO, he will be fine!!

Agree with Julia, just because storm and the banks screwed over the clients (they should definitely be reimbursed to the LVR, ie 5-10% of their value - and if there ppor mortgage takes them into negative equity, then that is not the bank's fault), it does not mean that the rest of the industry or even SMSF are shonky.

 

[Garpal Gumnut]

From the first page of this thread in Oct-Nov 2005

Thanks all

I've heard all of the above.

Gearing over the past 12 months would have been brave.

They are all over Australia I believe.

gg

I don't believe that they are for everyone as their methodology is very aggressive. I personally don't agree with it. Below are some bits of information I've taken from Storm seminars held.

Their actual investments are quite solid. Nothing o/seas, just Aussie shares/managed funds of which a fair portion are index tracking investments. But the main difference is the level of gearing. It is just debt on debt. The moment portfolios are re-valued upward they increase the debt accordingly.

My understanding is that Storm as a group brokered a deal with Macquarie so that their clients could extend further than the maximum 70% gearing ratio that applies to most others looking at margin lending. I also am of the view that they say the debt is never to be repaid (or at least it is not a large part of the financial plan). As the assets grow so to does the level of debt. As I undertstand it, Storm don't follow the rule of why you need to "retire" - or at least "retire" your money in retirement. They believe it is their to be used to create more wealth even in "old age".

When markets are going well - this doesn't seem a problem. But I think the way the market has been over the past 18 months it has highlighted a major flaw in the methodology. People need a certain comfort level at which they will sacrifice more wealth for a decent nights sleep and piece of mind. As you can see - I don't think that their actual "investment" advice (where the money was placed) would be a huge problem for them as they were fairly conservative but the "big picture plan" is a bit out there for some.

Duckman

Wisdom is always easy in hindsight.

gg

 

[Julia]

From the first page of this thread in Oct-Nov 2005

It was actually 2008.

Wisdom is always easy in hindsight.
gg

Not so much hindsight at that early stage, gg. The quotes from both yourself and Duckman at that stage make clear the dangers of the Storm model.

 

[bunyip]

Perhaps remember that the 'system' did not fail everyone. It is quite wrong to extrapolate from the shonky behaviour of the Storm principals that the whole financial system is dysfunctional.

So true.
This so-called ‘system’ which some on here consider to be seriously flawed and dysfunctional has, in fact, burnt only a small minority of investors overall. Hundreds of thousands of investors, possibly millions even, have had no problem with it.
And of the small minority burnt, it’s fair to say that it’s not the system alone that’s burnt them, but how they used the system.
Give two people the same kind of car – one will drive safely, the other will drive like crazy and end up getting hurt. All cars have the potential to harm us, yet we can still use them safely if we use them sensibly.
Same story with capitalism - the present ‘system’ in respect of investments, banks, wealth creation etc can be used to produce great profit, or much heartache, depending on how we use it.

There’s been much discussion on here about how we need changes to legislation so as to protect investors from being fleeced. Unfortunately though........
It’s not possible to stop unscrupulous people from operating on the edges of the law, or outside the law.
It’s not possible to remove all risk from investment.
It’s not possible to make people think for themselves and adopt a prudent and cautious approach to investing.

We don’t yet know what the eventual outcome of this Storm debacle will be.
But one thing certain is that irrespective of legislation, burnt investors will be as much a part of the future as they are a part of the past. As will successful investors.

 

[Harleyquin]

Agree the system didn't fail everyone but then I never said that it did.

 

[Frank Ainslie]

So true.
This so-called ‘system’ which some on here consider to be seriously flawed and dysfunctional has, in fact, burnt only a small minority of investors overall. Hundreds of thousands of investors, possibly millions even, have had no problem with it.
And of the small minority burnt, it’s fair to say that it’s not the system alone that’s burnt them, but how they used the system.
Give two people the same kind of car – one will drive safely, the other will drive like crazy and end up getting hurt. All cars have the potential to harm us, yet we can still use them safely if we use them sensibly.
Same story with capitalism - the present ‘system’ in respect of investments, banks, wealth creation etc can be used to produce great profit, or much heartache, depending on how we use it.

There’s been much discussion on here about how we need changes to legislation so as to protect investors from being fleeced. Unfortunately though........
It’s not possible to stop unscrupulous people from operating on the edges of the law, or outside the law.
It’s not possible to remove all risk from investment.
It’s not possible to make people think for themselves and adopt a prudent and cautious approach to investing.

We don’t yet know what the eventual outcome of this Storm debacle will be.
But one thing certain is that irrespective of legislation, burnt investors will be as much a part of the future as they are a part of the past. As will successful investors.

Bunyip,

"And of the small minority burnt, it’s fair to say that it’s not the system alone that’s burnt them, but how they used the system."

If you think that a 3 billion dollar loss by a small minority (if 12,000 or so investors can be considered such) isn't something to be concerned about, they must have put too much Sherry in your Christmas pudding! The system that was in place led to these losses. Therefore, it needs changing! It should also be remembered that it wasn't how the Storm investors used the system, (they were just the victims of it) but rather how Storm and the Banks used the system to further their own ends. If the lessons that history teach us are ignored, these financial disasters will continue to happen.

"It’s not possible to stop unscrupulous people from operating on the edges of the law, or outside the law."
Under the current laws, you are probably right! That's why we need laws that work for the investors, not those shonky financial advisers or banks in the financial sector that seek to exploit the loopholes!

We also need effective penalties for those that transgress. If someone robs a bank of twenty thousand or so, they get more time than a financial adviser or a bank that diddles people out of millions. Punitive measures are needed to act as a deterrent. Not just fines but some real jail time. Until this Government gets some backbone, this inequity will continue to exist in the financial sector.

"It’s not possible to remove all risk from investment."
Yes, investing will always contain some risk but investors should not be expected to also shoulder the risk of being duped out of their money by financial advisers and banks that do the wrong thing. It's up to this Government to put safeguards in place that will protect the public from the type of abuse (Storm for example) that seems to arise on a regular basis. It can be done but this Government and preceding Governments seem to lack both the will and the know how to do so! To say that nothing can be done because it is all too hard is a sad inditement of the people at the top's capacity to introduce measures that will protect investors interests.

"It’s not possible to make people think for themselves and adopt a prudent and cautious approach to investing."
We paid financial advisers to do the thinking. In so doing, we relied on the regulations then in place and such things as PI insurance to ensure that we had an avenue of recourse if the people we were dealing with did the wrong thing. That was our first mistake! Now we are paying for this government's ineptitude.

It is not the investors that need to adopt a prudent and cautious approach, but rather those that we place our trust in to do what we ask of them rather than play Russian roulette with our money.

Until this government is willing to fix the holes in our financial sector, another Storm and many more are just around the corner. Whilst we as a nation are prepared to accept that nothing can be done, nothing will be done.

 

[Mindstorm]

Hi Julia and all,

Trying once more to answer your post Julia, and hoping I can this time around.

Will try to do it in two posts this time.....

It's taken me a long time to come to terms with who filled in what forms, and who should/could/may be to blame.

I take full responsibility for signing some of the forms, and for being trusting/stupid enough to allow them to be completed after I had signed.

But surely the person who was going to lend me money should carry the greatest responsibility for accepting the content of the forms no matter who completed the form?

Should the banks not have had someone who had to verify what information those forms contained, to check that the information provided was correct, and to decide whether or not they were willing to accept the information provided in the forms?


MS

Don't you really? Surely it's a very fundamental point in terms of where the blame falls?


Two provisos here:

1. In some families such a question could be seen to be intrusive and purely an enquiry as to whether you as the potential inheritor have been well provided for.

2. I'm not sure that too many family members are sufficiently well equipped to offer advice regarding financial matters.

I do understand, however, what has prompted your suggestion. Just think it's a tricky area.

I'm glad to know you were able to enjoy the work Christmas party, Mindstorm.
Getting on with life is probably difficult for some, but the only way to emotional resolution imo.

I wish you and other ex Storm clients the best for 2012, and thank you sincerely for sharing some of your experiences and feelings with us.

 

[Julia]

Agree the system didn't fail everyone but then I never said that it did.

On the contrary, HQ, see your remarks below:

We need an honest and trustworthy financial system in this country and until we get one the general population needs to be aware that under our present system they can be fleeced by the very people we need to seek advice from.

The 'general population" has not been fleeced by anyone.

There is every chance ROE that you're right and 'this may never happen'. However, what is very obvious is that the present system is grossly ineffective or the storm debacle would never have occurred.

Please stop blaming "the system" which has served the great majority of investors perfectly well.

Agree wholeheartedly that we all need to be more vigilant when it comes to our own money.

You have similarly agreed many times before but still you keep blaming "the system" as being the cause of your downfall.

Bunyip,
If you think that a 3 billion dollar loss by a small minority (if 12,000 or so investors can be considered such) isn't something to be concerned about, they must have put too much Sherry in your Christmas pudding!

12,000 investors is not even a blip on the overall market.

The system that was in place led to these losses. Therefore, it needs changing!

Yeah, right. See my above comments to HQ.

It should also be remembered that it wasn't how the Storm investors used the system, (they were just the victims of it)

Oh dear, if Storm investors were simply victims of The System, how is it that other users of The System have not been fleeced?

It is not the investors that need to adopt a prudent and cautious approach,

If you actually believe this then you're in a perfect position to be taken advantage all over again.

 

[Julia]

Hi Julia and all,

Trying once more to answer your post Julia, and hoping I can this time around.

Will try to do it in two posts this time.....

It's taken me a long time to come to terms with who filled in what forms, and who should/could/may be to blame.

I take full responsibility for signing some of the forms, and for being trusting/stupid enough to allow them to be completed after I had signed.

But surely the person who was going to lend me money should carry the greatest responsibility for accepting the content of the forms no matter who completed the form?

Should the banks not have had someone who had to verify what information those forms contained, to check that the information provided was correct, and to decide whether or not they were willing to accept the information provided in the forms?


MS

Hello Mindstorm,
Simple answer to your final paragraph: Yes. I'd have thought so.
But my point was that throughout this thread there have been many assertions that the figures in the application forms were not those supplied by the clients. This is what I think absolutely needs clarification.

Given the obfuscating nature of the SOA put up here by Frank earlier, I'd not be surprised to learn that the application forms were similarly complex and the trusting investor could fairly easily be persuaded to "just sign here".
You'll never do it again, of course, but you will not have been the first to be so assured and you won't be the last.
Hope the coming year is better for you.

 

[Mindstorm]

Hi Julia,

Well, my response to the first part of this quote from you has successfully appeared on the forum. So, here goes for the second part...

I was always aware of my parents wishes as to what they wanted to do in their retirement and their deaths, and to whom they bequethed what, (or not). No family squabbles.

My own children were/are aware of my wishes for my retirement and death, and unfortunately, (now that they are adults), I'm aware of their wishes too.

There is no embarrassment in my own family of what we 'wish/expect for/would not accept' in old age, retirement, or death.

If someone in my family asked me questions about my wealth/lack of wealth, I'd be very open with them. Why wouldn't I be?

I have to say that I wouldn't discuss my financial wellbeing, (something I had pre Storm), with anyone outside my close friends or family.

As it is, post storm, my children are now going to have to look after me rather than me looking after their children, my grandchildren.

They've always told me to spend what I have enjoying myself while I'm here. They realise that I spent much of my earnings earlier in my/our life making sure that they were well educated enough to look after themselves in life and retirement.

I think my (family's) attitude is very healthy.

I can't begin to think what family you have who would think that you trying to help them financially could be put down to you being intrusive.

As to financial advice from family? I would have welcomed that. However, we are the oldest in our family, and we thought that we'd been given 'good advice' by Storm.

Our family had no reason to think otherwise. I'm sure that if they had, that they'd have told us, and we'd have maybe looked at it again.

20/20 hindsight.

Luckily, the Australian Public will pick up the tab for our imminent retirement.

MS

Don't you really? Surely it's a very fundamental point in terms of where the blame falls?


Two provisos here:

1. In some families such a question could be seen to be intrusive and purely an enquiry as to whether you as the potential inheritor have been well provided for.

2. I'm not sure that too many family members are sufficiently well equipped to offer advice regarding financial matters.

I do understand, however, what has prompted your suggestion. Just think it's a tricky area.

I'm glad to know you were able to enjoy the work Christmas party, Mindstorm.
Getting on with life is probably difficult for some, but the only way to emotional resolution imo.

I wish you and other ex Storm clients the best for 2012, and thank you sincerely for sharing some of your experiences and feelings with us.

 

[Mindstorm]

Hello Mindstorm,
Simple answer to your final paragraph: Yes. I'd have thought so.
But my point was that throughout this thread there have been many assertions that the figures in the application forms were not those supplied by the clients. This is what I think absolutely needs clarification.

Given the obfuscating nature of the SOA put up here by Frank earlier, I'd not be surprised to learn that the application forms were similarly complex and the trusting investor could fairly easily be persuaded to "just sign here".
You'll never do it again, of course, but you will not have been the first to be so assured and you won't be the last.
Hope the coming year is better for you.

Hello Julia,

Firstly I have to say that I am so pleased that ASF has finally allowed me to reply to your post. I am very old fashioned and would hate to think that anyone here (yourself included) thought that I had ignored a question.

Given that I completed the initial Storm forms so honestly, and so much to our particular detriment, I trusted that we were signing up for the 'same' deal as HQ or Frank.

Apologies for the pun Frank, but we were totally frank in our completion of the initial Storm forms.

I would imagine, (more than imagine, given the Stormies I've met so far), that we were totally honest because that was in our nature.

I didn't set out to try to convince anyone that we were any better off than we actually were. I didn't tell anyone that we spent or didn't spend any money on any trivial thing.

I should try to find that initial form given to me by our 'advisor' to show ASF readers how many trivial questions we had to answer so that storm could see how every last cent we had was spent.

For your information, Julia and all here, the figures in our initial application to the bank (s) for loans were true as far as I can ascertain.

Unfortunately, they were not enough for the bank (s).

Even more unfortunately, for who? Us? The bank (s)?

The bank (s) in question still gave me/us the loans that we did not fulfil the bank (s)
requirements for.....

I look forward to the banks being asked questions in court next year.

I think that it will be an eye opener for many of us/you, especially those who are bank shareholders.

Who knows what will happen in court next year? But, we Stormies will fight to the last to try to save anyone else going through the terrible time that we have had to.

Take care Julia, and I wish that we were all half as smart as you appear to be....

MS

 

[Solly]

Hi Julia and all,

Trying once more to answer your post Julia, and hoping I can this time around.

Will try to do it in two posts this time.....

It's taken me a long time to come to terms with who filled in what forms, and who should/could/may be to blame.

I take full responsibility for signing some of the forms, and for being trusting/stupid enough to allow them to be completed after I had signed.

But surely the person who was going to lend me money should carry the greatest responsibility for accepting the content of the forms no matter who completed the form?

Should the banks not have had someone who had to verify what information those forms contained, to check that the information provided was correct, and to decide whether or not they were willing to accept the information provided in the forms?


MS

MS

You have touched on a point that is of interest to me and my colleagues.

I wonder what compliance and governance practices and procedures were in place within these publicly listed institutions to verify the data that was presented in the documentation.

Who were these authorised officers within these organisations who had the delegated authority to verify and approve these submitted documents ?

I wonder what influence this will have with matters that are before the bench.

S

 

[Julia]

Given that I completed the initial Storm forms so honestly

I don't think any of us have ever doubted that Storm investors quite properly answered the questions on the application forms. But there have been assertions along the line that some either had their answers altered amongst the application process or who allowed either Storm or the banks to complete the forms.
I can't now remember exactly what was said but that was the general thrust and is what so took my attention.

I should try to find that initial form given to me by our 'advisor' to show ASF readers how many trivial questions we had to answer so that storm could see how every last cent we had was spent.

No need, MS. Your integrity is not in question.

The bank (s) in question still gave me/us the loans that we did not fulfil the bank (s)
requirements for.....

This is where I become puzzled. When you received the documentation for a loan which was considerably more than you'd applied for (and for which you fulfilled the lending criteria presumably), did you just accept it, not question how you came to be given such an unexpected amount?
There may be something I'm not understanding about the whole process here.

I wish that we were all half as smart as you appear to be....
MS

There is nothing 'smart' about me. I'm no more astute than the average person who has attempted to become financially literate.

 

[kincella]

here is an interesting example, of a very distant member of my extended family...
an, in- law...

they were immigrants from Russia in the 1960's. .they both worked hard in labouring jobs all their lives, built a beautiful 2 storey mansion...their pride and joy, they had one son, they doted on....life was good...they had paid off the mortgage many years ago...and were living comfortably....both were in good health...in their 60's....they finally started looked at retirement, and their plans for same...

the found a financial planner....they had been recommended to seek out same....to reduce their assets, and all the games, in order to acquire a higher age pension....

the wife had only ever had casual or part time work, although consistent and regular....she did not realise there was almost no compulsory super attached to this work...
his main job from the 1960's until 2000 provided little compulsory super...since it was only introduced about 1986
so there was little real savings, apart from the family home....to show for all their hard work
these people are non professionals, they were labourers, there was no university or higher education in their life.....
apart from going to work on time, looking after their only son, and watching soccer on tv....there was not much else that took their interest....they were more than happy with their lot in life....

until they started to add up, what funds they would need in retirement....and the current age pension would not provide it

so when a street smart financial planner, said he would make them rich beyond their wildest dreams.....that they were already rich and did not know it....that they were already millionaires....but were not acting like millionaires...

they jumped at the offer.....they did not have the nous, or experience, or ability to know they were being conned......
they believed this 'professional advisor'...and signed up to make millions...

they scoffed over, dismissed the fine detail, the legal advice, and warnings...
all their trust was in this one person.....they were not in a postiion to evaluate the proposition before them.....they were like most people...in their position...trying to save money, and most of all, believing in the person...who supposedly held, a superior position of power,,,

***the saying...if it sounds too good to be true...then run for your life....is most obvious...but never heeded...

fast forward just 3 years.....he does not know exactly how, but apparently he signed over his home, the mortgage became a margin loan, and he was the owner of some very dreadful, penny dreadful mining shares.....
the bank evicted him from his home, he rented a house, to remain in the same suburb...to avoid embarrassment from family, friends and neighbours.....it was costing $450 pw rent....he was receiving $450 a fortnight in unempoyment benefits.....the wife went back to full time work....it was all going downhill...

the only child, a son, who had been led to believe he would inherit the family home...is devastated....his marriage is holding together , but only just...

the father's health deteriorated, from the stress, he had a stroke, and other complications...he has been in intensive care now for 3 months....it is unlikely he will ever recover
the son and his new family, with 3 young children, have tried their hardest, to please the parents....they have moved out of their very affordable rental unit....and are now renting a 2 storey mansion...similar to what the parents original house was like....
the young mother is now working a late night shift, just to pay the rent....so the elderly parents-in -law, can pretend they are still wealthy....

ordinary working familes...up against...street smart operators....scammers....
but who is to blame....???
the son seems to be accepting his dilema...he will do anything for his parents...
he is devoted to them.....he will not allow any blame on his parents, for their decisions
his wife is not so sure...the stress, of not being able, to provide for her children...when alll available funds are directed to the parents...is showing....
I doubt the son and his family will survive the dissapointment..
the financial planner will probably survive.....
because you cannot protect people...from themselves...

 

[SJG1974]

So true.
This so-called ‘system’ which some on here consider to be seriously flawed and dysfunctional has, in fact, burnt only a small minority of investors overall. Hundreds of thousands of investors, possibly millions even, have had no problem with it.
And of the small minority burnt, it’s fair to say that it’s not the system alone that’s burnt them, but how they used the system.
Give two people the same kind of car – one will drive safely, the other will drive like crazy and end up getting hurt. All cars have the potential to harm us, yet we can still use them safely if we use them sensibly.
Same story with capitalism - the present ‘system’ in respect of investments, banks, wealth creation etc can be used to produce great profit, or much heartache, depending on how we use it.

There’s been much discussion on here about how we need changes to legislation so as to protect investors from being fleeced. Unfortunately though........
It’s not possible to stop unscrupulous people from operating on the edges of the law, or outside the law.
It’s not possible to remove all risk from investment.
It’s not possible to make people think for themselves and adopt a prudent and cautious approach to investing.

We don’t yet know what the eventual outcome of this Storm debacle will be.
But one thing certain is that irrespective of legislation, burnt investors will be as much a part of the future as they are a part of the past. As will successful investors.

I agree with this bunyip. well put.

 

[SJG1974]

This is where I become puzzled. When you received the documentation for a loan which was considerably more than you'd applied for (and for which you fulfilled the lending criteria presumably), did you just accept it, not question how you came to be given such an unexpected amount?
There may be something I'm not understanding about the whole process here.

Agreed...along with a number of other aspects of the entire model, alarm bells were sounding all over the place and yet investors seemingly ignored them and went ahead anyway.

 

[Frank Ainslie]

(Quoted from my BOQ website)

Mr. David Liddy, the former Managing Director and CEO of the Bank of Queensland, has proudly proclaimed, "We're the bank with OWNER-Managers. That's what sets us apart!"

"Praise from Caesar is praise indeed!"

If the performance of the Bank of Queensland's North Ward branch, Townsville in its past dealings with the failed financial advisory company, Storm Financial, is anything to go by, Mr. Liddy's words are certainly prophetic. That branch of the BOQ certainly did set itself apart!

Here are just some of the testimonials from within the BOQ itself about it's North Ward owner managers' past conduct:

"Basically none of the info provided and input on the applicant is accurate... I would suggest that things may unravel at a rate of knots from this point on..." [Lindsay Johnson BOQ Risk Assessment]

"North Ward branch had, in many instances, not included Storm client's margin loans as a liability when calculating whether they could afford more debt...
"On many referred loans a standard comment ‘no other debts held other than for example credit card etc' despite knowledge of an existing margin loan...

"Income confirmation is based upon a printout of Colonial Geared Investments" which indicated that they had a margin loan of $1.453 million. We should have investigated amounts borrowed and included in servicing....

"A print out of Macquarie Margin loan showed a debt of $724,000 however there was "no allowance in servicing for this debt...

"When applying for an earlier loan, in August 2006, the bank had on file a rate notice dated August 2004 which indicated a pension discount for Mr Reynolds, so the $100K income claimed in the application is obviously not true...

"Over and over again Storm had sent the North Ward an initial letter detailing margin loans but that these amounts were "not disclosed" in the Bank's computer system or the loan applications...

"In one case, the report noted that an initial letter from Storm had indicated a margin loan balance of $1,318,402 but that North Ward's co-owner manager "Mr Matthew Buchanan had stated in comments recommending approval ‘No other debts held other than credit card facility...

"Had such margin loan amounts been included in the Bank's serviceability calculations, it's highly unlikely the loans would have been granted...
"Noted that North Ward branch had accepted photocopies of disbursement authorities from clients on Storm letterhead. Best banking practice is that photocopies are not accepted because they are too hard to authenticate...

"Example of one couple who took a $1.168 million dollar Bank of Queensland mortgage. Their disbursement authority authorised the payment of $280,919 directly to Storm in what appeared to be a commission payment. This represents 24% of the loan amount...

"It is noted from review of some of the loan files that it could be construed that income and ongoing commitments may have been manipulated to achieve approval. Should this prove to be the case, then these loans could be set aside..." [Jeff O'Sullivan, BOQ Senior Manager - Credit Risk Review]

"In the months following the initial 2006 credit risk review, action should have been taken by the BOQ's area manager and state manager to ensure the problem areas were fixed. But there was a recurrence of the same sort of problems identified in the 2008 credit risk review...

"I have conducted a number of credit risk reviews of North Ward's business over the years and have previously questioned the integrity of the data on the files... These credit risk reviews had been conducted in late 2006/early 2007 and another in February 2008. In addition to these two formal reviews of the North Ward branch, there were two or three informal reviews initiated to "clarify some rumours that were going round the bank." [Mr Alan Butler, BOQ Head of Portfolio Management and Financial Crimes]
"Prepare a report in relation to the processes that saw Reynolds (a Vietnam Vet also now mentioned by the ‘Sydney Morning Herald’) receive a loan, whether our processes were followed ... and any remedial action we may need to undertake in relation to customers... The purpose of the review was "firstly potentially being able to selectively use outcomes for external (press) purposes and secondly, whether our process has been followed... Sooner or later we will receive some hard questions about Storm, our relationship and affected customers. While, from what we have seen to date our position is defensible, there remain some gaps..." [Mr Bruce Auty, BOQ Group Excecutive]

On 25 June, 2009, the Bank made a statement to the Australian Stock Exchange saying, "Based on the Bank's knowledge and enquiries to date: There is no evidence of improper or dishonest practices or conduct by the Bank in connection with Storm clients."

In evidence to a Joint Federal Parliamentary Committee in September 2010, Mr Liddy stated, "If there was wrongdoing in the North Ward branch and we had identified wrongdoing, we would take action."

It defies credibility that Mr. Liddy, the CEO of the Bank of Queensland at that time, was not kept informed about the goings-on in the North Ward branch. He was either one of the most inept CEO's in the history of banking or he has deliberately misled a Parliamentary Joint-Committee.

What is the penalty for deceiving a Parliamentary Joint-Committee these days or are banks executives immune from prosecution because they regularly suffer from amnesia?

 

[Solly]

(Quoted from my BOQ website)

Mr. David Liddy, the former Managing Director and CEO of the Bank of Queensland, has proudly proclaimed, "We're the bank with OWNER-Managers. That's what sets us apart!"

"Praise from Caesar is praise indeed!"

If the performance of the Bank of Queensland's North Ward branch, Townsville in its past dealings with the failed financial advisory company, Storm Financial, is anything to go by, Mr. Liddy's words are certainly prophetic. That branch of the BOQ certainly did set itself apart!

Here are just some of the testimonials from within the BOQ itself about it's North Ward owner managers' past conduct:

"Basically none of the info provided and input on the applicant is accurate... I would suggest that things may unravel at a rate of knots from this point on..." [Lindsay Johnson BOQ Risk Assessment]
....................................

Hi Frank

A little off topic but I have always found this BOQ approach to saving rather strange.

Bank of Queensland to use lottery tickets to attract customers
http://www.dailytelegraph.com.au/bu...ttract-customers/story-e6frez7r-1225939007554

It gives me the impression that banking is a bit of a gamble, not sure if that was their Marketing Dept's intention. But it's good to see they still offer a good solid 1% on the deposits on that account type.

It's a pity but gone are the days when I used to see Big Dave in his silver Porsche exiting skillfully into Elizabeth St, when I was en route to the Cathedral to light some candles for the Stormers and to pray for continuing beer supplies to the Ross Island

S

 

[Garpal Gumnut]

I have decided to go through the thread from 2008 to now, and pick out some pertinent posts

This is from Pages 1/2

Oct-Dec 2008



gg

Upon recently stumbling across this web site I was pleasently surprised, although reading some of the recent postings on your site regarding Storm Financial I have found that most of your members seem to be ill informed. I have been an investor with Storm for the last 4 years and have found this company to be nothing less than fantastic. Anyone that finds themselves invested in the stock market in these economic times will be finding it difficult, some more than others. Whilst reading some of the comments made by members of this site it sickens me to think that you can be so ignorant to the facts in this matter. Throughout this ordeal we have been in constant contact with Storm with updates on ours and their postion. I'm sure if you asked Coloniel lending some of the tougher questions being thrown Storms way you would have a greater understading of the mess in which Storm finds themselves. As for Storm taking it's clients on a fully paid for overseas holiday to Africa, this is nothing but utter rubbish. Anyone who choose to go on this trip was self funded. Remember not everthing that the media writes is gosspel. We should all be aware of the gossip mongering that has been created throughout this controversay. I, as a client of Storm Financial will be with them all the way.
Here's to a better economic year ahead!

very easy to see how this has happened.

if you had high gearing (50-70%) from 2003 to 07, on the ASX200, you what have though your Investment advisors were the best in the world!

the big question is at what point do you start selling, if you are a long term investor, in the event of a market downturn.

maybe not 10%, as these could just be just a regular blip.

but surely after that, serious readjustment is advisable.

whats happened over the last 6 months is no regular blip, anyone with any financial knowledge knows this

if on low income, with small tax offset, high gearing would need to be monitored day to day

as for people losing their houses, one unfortunate fact I have learned is that one should not allow negative equity to occur, in other words, if a margin call is approaching, far safer to liquidate your investment for $0.

would be extremely interesting to see if any Storm investors had regular written reviews of their plans.

fundamental conflict of interest exists if planners get 7%

I doubt it will be back, for people interested at looking at the site, you can go to:

http://web.archive.org/web/20071028114029/http://www.stormfinancial.com.au/

... Some hype from the site:

"Our strength comes from providing quality services and advice, based on sound research, which integrate smoothly with your life goals and ambitions"

"The Storm processes and systems are tried and true. The outstanding results achieved over 30 years demonstrate a proven formula, consistently applied, based on a rock solid foundation"

"Everything that we do at Storm is based on seasoned research and carefully considered planning."

All sounds good.

ASIC have a long record of underperformance when it comes to protecting investors.

A number of questions I might ask of ASIC's involvement.

1. Why now. Blind Freddie knew this mob's algorithm was a recipe for disaster 12 months ago.

2. Where. Where will they find the documents, people to investigate properly, many like a mate of mine are too ashamed to admit their involvement.

3. How. The best predictor of future behaviour is past behaviour, ASIC are a joke.

4. When When most people have lost the lot, the bad guys have shifted money offshore and most folk have forgotten....about 2013 imho.

gg

It is interesting how it has all panned out.

gg